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gizmo_the_mogwai [7]
3 years ago
8

Javier and Anita Sanchez purchased a home on January 1, 2019, for $600,000 by paying $200,000 down and borrowing the remaining $

400,000 with a 7 percent loan secured by the home. The loan requires interest-only payments for the first five years. The Sanchezes would itemize deductions even if they did not have any deductible interest. The Sanchezes’ marginal tax rate is 32 percent.
Assuming the interest expense is their only itemized deduction for the year and that Javier and Anita file a joint return, have great eyesight, and are under 60 years of age, what is the after-tax cost of their 2019 interest expense?
Business
1 answer:
mel-nik [20]3 years ago
4 0

Answer:

The after-tax cost of their 2019 interest expense is $19,040

Explanation:

In order to calculate the after-tax cost of their 2019 interest expense we would have to calculate the following formula:

after-tax cost of their 2019 interest expense=Interest before tax expense-tax

Interest before tax expense=$400,000*7%

Interest before tax expense=$28,000

tax=$28,000*32%

tax=$8,960

after-tax cost of their 2019 interest expense=$28,000-$8,960

after-tax cost of their 2019 interest expense=$19,040

The after-tax cost of their 2019 interest expense is $19,040

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Answer:

utilitarian

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3 years ago
LO 8.5When might an unfavorable variance be a good outcome?
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The following information is for the Jeffries​ Corporation: Product​ A: Revenue ​$18.00 Variable Cost ​$14.00 Product​ B: Revenu
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Jeffries Corporation's Operating Income from the two products is <em>A. ​$35,000.</em>

The operating income is the difference between the revenue and operating costs (variable and fixed costs).

Data and Calculations:

                             Product A     Product B     Total

Revenue                 $18.00           $21.00

Variable cost            14.00              13.00

Contribution            $4.00             $8.00

Fixed costs                                                 $143,000

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Sales mix                  3                        1               4

Sales units             26,700           8,900      35,600

Total contribution$106,800      $71,200  $178,000

Total fixed costs                                          143,000

Operating income                                      $35,000

Thus, the operating income is $35,000.

Read more: brainly.com/question/14815746

 

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